Saturday, March 21, 2026

There’s currently $1.7 trillion in outstanding student debt — roughly 25% of which, or $425 billion, was believed to be in default as of last year.

McMahon sends letter to 9M delinquent student borrowers that Bessent is new debt collector — with $425B on the line


WASHINGTON — Education Secretary Linda McMahon is sending a letter to 43 million Americans with student loans — about 9 million of whom are in default — to notify them that the Treasury Department is taking over debt collection, The Post has learned.

The letter describes the transfer of responsibilities as a way to protect taxpayers by improving the efficiency of the collection process — after loan repayments were paused through much of the Biden administration, with borrowers protected from delinquency through September 2024.

“For too long, Americans have shouldered the consequences of poor leadership and persistent mismanagement of our federal student aid portfolio. Today’s actions reclaim integrity and accountability for you, the American people,” McMahon writes in the letter shared with The Post ahead of the mass mailing.

There’s currently $1.7 trillion in outstanding student debt — roughly 25% of which, or $425 billion, was believed to be in default as of last year.

The move gives new responsibilities to Treasury Secretary Scott Bessent, whose department’s Bureau of the Fiscal Service is taking on the collection role.


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